Overall Foreclosure Activity Drops In October, But Still High

The numbers of properties in some part of the foreclosure process dropped by 4% nationwide in October but still remain at the level they held in October 2009, according to RealtyTrac.

The leading online market for foreclosed and distressed properties reported that one in every 389 U.S. properties received a default notice, was added to a foreclosure auction or was repossessed by a bank last month.

"October marks the 20th consecutive month where over 300,000 U.S. homeowners received a foreclosure notice," said RealtyTrac CEO James Saccacio. "The numbers probably would have been higher except for the fallout from the recent 'robo-signing' controversy--which is the most likely reason for the 9 percent monthly drop in REOs we saw from September to October and which may result in further decreases in November."

But the firm also reported that default notices dropped by 2% last month, which is the ninth straight month that default notices have declined year over year. Default notices are generally considered the first step in the formal foreclosure process in many states and are therefore often seen as a precursor to later foreclosures.

As with previous months, Nevada, Florida and Arizona continued to post the highest foreclosure rates.